Is There Finally Value in Software?

What’s in Today’s Report:

• Is There Finally Value in Software?
• Empire State Manufacturing Survey Takeaways.

Futures are lower with semiconductor/tech stocks leading the declines on valuations concerns as geopolitical tensions remain elevated, pushing oil and bond yields higher (the 30-Yr Bond yield is above 5.30%).

Economically, U.K. Unemployment held steady at 4.9%, meeting expectations but the release did not materially impact markets with focus on oil, geopolitics, and global bond yields sitting at multi-decade highs.

Today, there is a fair bit of economic data to watch including Industrial Production (E: 0.3%), Housing Starts (1.345M), Pending Home Sales (E: 1.4%), and Import & Export Prices (E: 0.1% m/m, 0.0% m/m). The best case scenario for equities is healthy (but not “hot”) growth data and “cooler than feared” inflation data.

There are no Fed officials speaking today which will leave bond markets focused on 6-Week Treasury Bill auction at 11:30 a.m. ET (the stronger the demand the better).

Earnings season is winding down, however there are a handful of noteworthy companies reporting quarterly results today, including HD ($4.71), BIDU ($1.51), KEYS ($2.48), SQM ($2.03), and TOL ($2.90). As has been the case, the stronger the results/guidance, the better for stocks.